Applied Optoelectronics Inc stock falls amid market decline
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Nov 07 2025
0mins
Should l Buy AAOI?
Source: Fool
Applied Optoelectronics Inc's stock price dropped by 11.16% as it crossed below its 5-day SMA, reflecting a challenging market environment.
The decline in stock price is attributed to broad market weakness, with the Nasdaq-100 down 1.78% and the S&P 500 down 1.31%. This broader market trend has negatively impacted investor sentiment towards Applied Optoelectronics, contributing to its significant price drop.
As the company navigates through this difficult market landscape, investors are advised to monitor upcoming earnings reports and market conditions closely.
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Analyst Views on AAOI
Wall Street analysts forecast AAOI stock price to fall
4 Analyst Rating
3 Buy
0 Hold
1 Sell
Moderate Buy
Current: 44.460
Low
15.00
Averages
38.25
High
50.00
Current: 44.460
Low
15.00
Averages
38.25
High
50.00
About AAOI
Applied Optoelectronics, Inc. is a vertically integrated provider of fiber-optic networking products. The Company designs and manufactures a range of optical communications products at varying levels of integration, from components, subassemblies, and modules to complete turn-key equipment. The Company also designs, manufactures, and integrates its own analog and digital lasers using the proprietary Molecular Beam Epitaxy (MBE) and Metal Organic Chemical Vapor Deposition (MOCVD) alternative processes for the fabrication of lasers. The Company manufactures lasers and laser components and performs research and development activities for laser component and optical module products. The Company offers its fiber-optic networking products, primarily for four networking end-markets, such as cable television, (CATV), Internet data center, telecommunications, (telecom), and fiber-to-the-home (FTTH). The Company has manufacturing facilities in Taipei, Taiwan and Ningbo, China.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Applied Optoelectronics Breaks Ground on New Texas Facility
- New Facility Groundbreaking: Applied Optoelectronics has broken ground on a new manufacturing facility in Sugar Land, Texas, covering over 210,000 square feet, aimed at meeting the growing demand for optical and HFC networking products, thereby enhancing the company's competitive position in the market.
- Investment Plan Expansion: The company plans to increase its investment in this facility and its headquarters from $150 million to potentially $300 million by the end of next year, a move expected to significantly boost production capacity and support future business growth.
- Job Creation Commitment: This project commits to creating 500 local jobs related to the programming of automated production lines, further driving local economic development and enhancing the company's influence in the industry.
- Market Reaction: Despite the positive expansion plans, Applied Optoelectronics' shares fell 1.58% in premarket trading, indicating a cautious market sentiment regarding its future performance.
See More
Applied Optoelectronics Breaks Ground on New $300 Million Facility
- Groundbreaking Ceremony: Applied Optoelectronics held a groundbreaking ceremony on February 10, 2026, for its new 210,000 square foot manufacturing facility in Sugar Land, Texas, marking a significant expansion in the optical and HFC networking product sector.
- Increased Investment Plans: The company plans to increase its investment in the new facility and headquarters from $150 million to potentially $300 million by the end of next year, which will significantly enhance its market position in the AI and datacenter industry.
- Job Creation: The construction of the new facility is expected to create 500 local jobs related to the programming of automated production lines, further driving local economic development and enhancing the company's competitiveness in the industry.
- State Support: The support from the Texas state government is viewed as a key factor in the success of the company's expansion plans, indicating that the state's leadership in AI will provide a favorable environment for Applied Optoelectronics' future growth.
See More
1492 Capital Management Fully Exits Shift4 Payments Stake
- Stake Change: 1492 Capital Management completely sold its 61,345 shares in Shift4 Payments during Q4 2026, with an estimated transaction value of $4.75 million, indicating a strategic exit amid declining stock performance.
- Stock Performance: As of February 9, 2026, Shift4 Payments shares were priced at $58.61, reflecting a 52.1% decline over the past year, significantly underperforming the S&P 500 by 67.15 percentage points, raising concerns about its future outlook.
- Company Overview: Shift4 Payments specializes in payment processing and commerce-enabling software, serving various sectors including hospitality and eCommerce; despite a 22% revenue growth year-over-year in the first nine months of 2025, it faces intense competition and uncertainty.
- Management Transition Impact: Following founder Jared Isaacman's resignation, Shift4 Payments is undergoing a leadership transition, and while new CEO Taylor Lauber may drive growth, market sentiment remains cautious regarding the company's future performance.
See More
1492 Capital Fully Exits Shift4 Payments Stake
- Share Sale Details: On February 10, 2026, 1492 Capital Management disclosed in an SEC filing that it sold its entire holding of 61,345 shares in Shift4 Payments during Q4, with an estimated transaction value of $4.75 million, indicating a $4.75 million decline in the company's stake value during this period.
- Impact on Holdings: Prior to the sale, Shift4 Payments accounted for 1.9% of 1492 Capital's AUM, and following the divestment, the fund holds no shares, reflecting concerns about the company's future prospects amid ongoing market challenges.
- Market Competition Pressure: Although Shift4 carved out a lucrative niche in the hospitality fintech sector, its stock has struggled in a highly competitive environment, particularly following the resignation of its founder, which likely influenced 1492 Capital's decision to exit its position.
- Future Growth Expectations: Despite analysts forecasting a slowdown in revenue growth to 25% in 2026, the anticipated 35% growth for 2025 and a relatively low 28 P/E ratio for a rapidly growing stock suggest a complex market perception regarding Shift4's future potential.
See More
Applied Optoelectronics Executive Sells Shares
- Insider Selling Details: On January 28, 2026, Applied Optoelectronics' Senior Vice President and Chief Legal Officer David C Kuo sold 12,000 shares valued at approximately $540,660, representing 9.48% of his holdings and reducing his ownership stake to 0.17% in the company.
- Trading Plan Context: Kuo's share sale was executed under a pre-scheduled Rule 10b5-1 trading plan, indicating that this transaction was not made at his discretion on the sale date, but rather planned in advance, reflecting a strategic approach to market fluctuations.
- Market Performance Review: Although AAOI's stock price increased by about 20% in January 2026, it experienced a disappointing 4% decline throughout 2025, highlighting the company's struggles with high operating costs and persistent negative net margins, particularly in the challenging U.S. fiber optic market.
- Investor Considerations: The company has reported negative net losses since 2019, prompting investors to closely monitor its operational challenges, especially given the high costs and infrastructure issues in the fiber optic sector that could impact future profitability and market performance.
See More
Applied Optoelectronics Executive Sells Shares Amid Market Concerns
- Executive Sell-off: David C Kuo, Senior VP and Chief Legal Officer of Applied Optoelectronics, sold 12,000 shares on January 28, 2026, for approximately $540,660, reducing his direct holdings to 114,636 shares, which represents 0.17% of total outstanding shares.
- Transaction Pattern: This sale aligns with Kuo's median sale size of 12,250 shares since November 2024, indicating a consistent pattern of disposals; despite a 20% increase in stock price in January, the overall performance remains concerning.
- Financial Overview: Applied Optoelectronics has a market capitalization of $2.98 billion and a one-year price change of 64.38%, yet it has reported negative net margins since 2019, struggling with high operating costs, particularly in U.S. infrastructure implementation.
- Investor Considerations: While Kuo's sale was part of a pre-scheduled trading plan, investors should remain vigilant regarding the company's ongoing negative margins and operational challenges, which could adversely affect future stock performance.
See More
Applied Optoelectronics Breaks Ground on New Texas Facility
- New Facility Groundbreaking: Applied Optoelectronics has broken ground on a new manufacturing facility in Sugar Land, Texas, covering over 210,000 square feet, aimed at meeting the growing demand for optical and HFC networking products, thereby enhancing the company's competitive position in the market.
- Investment Plan Expansion: The company plans to increase its investment in this facility and its headquarters from $150 million to potentially $300 million by the end of next year, a move expected to significantly boost production capacity and support future business growth.
- Job Creation Commitment: This project commits to creating 500 local jobs related to the programming of automated production lines, further driving local economic development and enhancing the company's influence in the industry.
- Market Reaction: Despite the positive expansion plans, Applied Optoelectronics' shares fell 1.58% in premarket trading, indicating a cautious market sentiment regarding its future performance.
See More
Applied Optoelectronics Breaks Ground on New $300 Million Facility
- Groundbreaking Ceremony: Applied Optoelectronics held a groundbreaking ceremony on February 10, 2026, for its new 210,000 square foot manufacturing facility in Sugar Land, Texas, marking a significant expansion in the optical and HFC networking product sector.
- Increased Investment Plans: The company plans to increase its investment in the new facility and headquarters from $150 million to potentially $300 million by the end of next year, which will significantly enhance its market position in the AI and datacenter industry.
- Job Creation: The construction of the new facility is expected to create 500 local jobs related to the programming of automated production lines, further driving local economic development and enhancing the company's competitiveness in the industry.
- State Support: The support from the Texas state government is viewed as a key factor in the success of the company's expansion plans, indicating that the state's leadership in AI will provide a favorable environment for Applied Optoelectronics' future growth.
See More
1492 Capital Management Fully Exits Shift4 Payments Stake
- Stake Change: 1492 Capital Management completely sold its 61,345 shares in Shift4 Payments during Q4 2026, with an estimated transaction value of $4.75 million, indicating a strategic exit amid declining stock performance.
- Stock Performance: As of February 9, 2026, Shift4 Payments shares were priced at $58.61, reflecting a 52.1% decline over the past year, significantly underperforming the S&P 500 by 67.15 percentage points, raising concerns about its future outlook.
- Company Overview: Shift4 Payments specializes in payment processing and commerce-enabling software, serving various sectors including hospitality and eCommerce; despite a 22% revenue growth year-over-year in the first nine months of 2025, it faces intense competition and uncertainty.
- Management Transition Impact: Following founder Jared Isaacman's resignation, Shift4 Payments is undergoing a leadership transition, and while new CEO Taylor Lauber may drive growth, market sentiment remains cautious regarding the company's future performance.
See More
1492 Capital Fully Exits Shift4 Payments Stake
- Share Sale Details: On February 10, 2026, 1492 Capital Management disclosed in an SEC filing that it sold its entire holding of 61,345 shares in Shift4 Payments during Q4, with an estimated transaction value of $4.75 million, indicating a $4.75 million decline in the company's stake value during this period.
- Impact on Holdings: Prior to the sale, Shift4 Payments accounted for 1.9% of 1492 Capital's AUM, and following the divestment, the fund holds no shares, reflecting concerns about the company's future prospects amid ongoing market challenges.
- Market Competition Pressure: Although Shift4 carved out a lucrative niche in the hospitality fintech sector, its stock has struggled in a highly competitive environment, particularly following the resignation of its founder, which likely influenced 1492 Capital's decision to exit its position.
- Future Growth Expectations: Despite analysts forecasting a slowdown in revenue growth to 25% in 2026, the anticipated 35% growth for 2025 and a relatively low 28 P/E ratio for a rapidly growing stock suggest a complex market perception regarding Shift4's future potential.
See More
Applied Optoelectronics Executive Sells Shares
- Insider Selling Details: On January 28, 2026, Applied Optoelectronics' Senior Vice President and Chief Legal Officer David C Kuo sold 12,000 shares valued at approximately $540,660, representing 9.48% of his holdings and reducing his ownership stake to 0.17% in the company.
- Trading Plan Context: Kuo's share sale was executed under a pre-scheduled Rule 10b5-1 trading plan, indicating that this transaction was not made at his discretion on the sale date, but rather planned in advance, reflecting a strategic approach to market fluctuations.
- Market Performance Review: Although AAOI's stock price increased by about 20% in January 2026, it experienced a disappointing 4% decline throughout 2025, highlighting the company's struggles with high operating costs and persistent negative net margins, particularly in the challenging U.S. fiber optic market.
- Investor Considerations: The company has reported negative net losses since 2019, prompting investors to closely monitor its operational challenges, especially given the high costs and infrastructure issues in the fiber optic sector that could impact future profitability and market performance.
See More
Applied Optoelectronics Executive Sells Shares Amid Market Concerns
- Executive Sell-off: David C Kuo, Senior VP and Chief Legal Officer of Applied Optoelectronics, sold 12,000 shares on January 28, 2026, for approximately $540,660, reducing his direct holdings to 114,636 shares, which represents 0.17% of total outstanding shares.
- Transaction Pattern: This sale aligns with Kuo's median sale size of 12,250 shares since November 2024, indicating a consistent pattern of disposals; despite a 20% increase in stock price in January, the overall performance remains concerning.
- Financial Overview: Applied Optoelectronics has a market capitalization of $2.98 billion and a one-year price change of 64.38%, yet it has reported negative net margins since 2019, struggling with high operating costs, particularly in U.S. infrastructure implementation.
- Investor Considerations: While Kuo's sale was part of a pre-scheduled trading plan, investors should remain vigilant regarding the company's ongoing negative margins and operational challenges, which could adversely affect future stock performance.
See More
